Galaxy delays Mt Cattlin spodumene shipments

By Myles McCormick
Published: Tuesday, 27 September 2016

First lithium shipment in December; Cargo delayed by three months; Concerns for 2017 contract prices

Galaxy Resources Ltd will ship the first volumes of spodumene from the newly reopened Mt Cattlin mine in December this year, rather than September as previously indicated.
The company said a combination of factors mean that the processing plant will not be fully operational until November, resulting in the three-month shipping delay. These factors included efforts to double the sites throughput to 1.6m tpa, heavy seasonal weather, alterations to project management and changes being built into the plant’s mica removal circuit.

Galaxy also indicated that, as a result of the throughput increase and other modifications, total capital cost to complete construction and commissioning work at Mt Cattlin had been increased to Australian dollar (A$) 22.4m ($16.9m*), up from the $15m previously forecast.

In a statement, Galaxy noted it had engaged an engineering consulting group in the wake of its takeover of General Mining, which had previously been operating Mt Cattlin on its behalf, to review the site’s construction, commissioning and production schedule. An analysis carried out by the group resulted in the revised schedule.
The company added that despite the delays – of which offtake partners and customers have been kept informed – it is negotiating terms to provide additional tonnage to customers in 2017 and beyond.
In a statement released 19 September Galaxy said the new timeline remained accurate.

IM heard last month that new production of lithium concentrate from Western Australia, where material is being brought to the market from Mt Cattlin and nearby Mt Marion, would be a key determinant of 2017 lithium contract prices.

Any delay would disrupt the market and may lead to a price increase, market participants told IM.

Meanwhile, the nearby Mt Marion spodumene mine, co-owned by Neometals Ltd, Mineral Resources Ltd and China’s Ganfeng Lithium, is expected to make its maiden shipment in late October.

Tianqi board approves WA lithium hydroxide plant
  • Logistics key to selecting Australia plant
  • Plan to up spodumene concentrate output
  • Spodumente to be sourced at Greenbushes

Myles McCormick

China’s Tianqi Lithium Corp. has given the go ahead to a 24,000 tpa lithium hydroxide facility in Kwinana, Western Australia.

The company expects to begin construction of the facility in the next two months, at a total cost of Australian dollar (A$) 400m ($303m). Production is scheduled to begin in late 2018.

The spodumene concentrate to be processed at the plant will be sourced from the company’s Greenbushes project, which it owns through its 51% stake in Talison Lithium, alongside fellow lithium major Albemarle Corp.

Tianqi said it would aim to increase the production rate of Greenbushes in conjunction with Albemarle "to meet the growth plans of both partners". The mine has an output of 575,000 tpa lithium concentrate at peak conditions "assuming certain operating conditions are satisfied", according to Albemarle, which last month announced it was purchasing lithium processing facilities in China.

A meeting of the local planning authorities on 31 August unanimously approved the facility, according to minutes published by the Western Australia Department of Planning on 6 September.

Phil Thick, general manager of Tianqi Lithium Australia, said in a statement that transport efficiency was a key factor in locating the plant in Australia rather than in China. Kwinana is around 210km north of Greenbushes.

"The plant’s close location to the mine is more efficient than transporting the bulk product all the way to China, which also reduces delivery risk so we can efficiently and reliably get product to end markets," he said on 6 September.

Thick also pointed to the availability of infrastructure and technological expertise as other factors that influenced the location decision and noted that the plant had been designed to allow for future expansion, depending on market conditions.

The board decision is still subject to shareholder ratification.

*Conversions made September 2016